Pensioners are some of the most financially vulnerable members of our community. Although many have a high-value asset, their family home, they tend to be income poor. Most will get by on between $24,000 and $28,000 a year, so they are by no means well off.

With an income such as that—$24,000 to $28,000 a year—you are highly susceptible and highly vulnerable to changes in the level of that income, particularly given that, as a person ages, the incidence of requirement for access to health care can tend to grow, increasing insurance expenses and other expenses associated with looking after yourself.

That is why I and my colleagues have taken our time to work through the details of these very substantial reforms and changes to the way the pension system works in Australia. I have consulted many pensioners in the community of Kingsford Smith, and I want to thank those pensioners who have contacted me and my office to outline the details of their concerns regarding what the government is proposing with these reforms. It is on the basis of those consultations and working through the details of the Abbott government's proposed reforms that I have decided, with my Labor colleagues, to oppose the proposed changes to the pension taper rates.

The basic reason why I have decided to make that decision is that these changes are grossly unfair. They target some of the most vulnerable in our community. Two hundred and thirty-six thousand vulnerable elderly Australians will be worse off because of these reforms, by an average of $130 a fortnight. That is $3,380 a year that part pensioners will be out of pocket because of the Abbott government's reforms. A further 91,000 pensioners will lose their pension altogether. That is $4,940 a year that they will be worse off by.

The thing about this reform is that it gets worse into the future. The nature of the change compounds into the future because of the ageing of the Australian population. More and more retirees, into the future, will be affected by these changes, leaving more and more people in our community who are vulnerable. This is something that has been recognised by many who have made submissions to the Senate inquiry regarding these proposed reforms. Industry Super Australia have said that within 10 years half of all retirees will be impacted by these changes. Importantly, most of those people will be women. I think eight out of 10 of those who will be affected by these changes will be women, disproportionately affecting vulnerable women within our community. But, although the government is proceeding with these changes, there are massive taxation concessions that are available to some of the wealthiest individuals in Australia—people with well over $1 million in superannuation balances. Many of those people pay no tax whatsoever on their income from superannuation. So here we have the government wanting to take money from part pensioners, some of the most vulnerable in our community, but they will not touch those who are on some of the largest incomes in Australia and who are the biggest drain on the federal budget and fiscal consolidation and sustainability into the future.

That is why these reforms are unfair, and the best way to highlight this unfairness is through some concrete real-life examples. I would like to outline a few of those now. A single pensioner who owns her own home and is earning $28,900 from interest and earnings on superannuation, under this government's proposals, will lose $8,200 per year. Almost a quarter of her entire income in one year will be lost. But someone who has $1½ million in superannuation and is earning around $100,000 a year in income on that superannuation will not be touched. They pay no tax on that at all. That is unfair. Another example is a couple who own their own home and earn $45,000 together off their superannuation. Under the Abbott government's reforms, they will lose their entire part pension of $11,400 per year. Tony Abbott has his hand in their pockets and will take almost a quarter of their entire income for that year. This reform simply is attacking some of the most vulnerable in our community whilst letting off some of the most wealthy, who are the biggest drain on our budget into the future.

I and my Labor colleagues understand that we need to develop a position in our budget that is fiscally sustainable into the future. We understand that. Labor is deeply conscious of that. That is why we have offered close to $20 billion worth of savings over 10 years, or additional revenue over 10 years, for the budget through reforms to taxation, and in particular to superannuation tax concessions.

I want to talk a little about those tax concessions. The approach that I have taken in respect of this and the holistic debate on fiscal sustainability is: how do we generate more revenue for our budget? How do we generate savings for the budget? But how do we do those things in a manner that is fair? It must be fair. Importantly, it must not attack the most vulnerable and push some of those people into poverty. One way to do that is to have a look at superannuation tax concessions.

Currently in Australia, the wealthiest 10 per cent of Australians—so, those who are in the highest-income quintiles in our nation—get 38 per cent of the tax concessions. That is almost 40 per cent of the tax concessions under the current fiscal arrangements. I can give an example of that. I gave some examples of how pensioners are going to lose but I will also give some examples of how wealthy superannuants are not touched by these proposals.

There are 475 Australians with superannuation balances of more than $10 million—$10 million! Let's assume that they earn an average five per cent return on that superannuation balance, which is an average return in the market at the moment. Such a person would get $500,000 a year from their superannuation as an income. That is half a million dollars per year from their superannuation as an income. Under this proposal—under what the Abbott government wants to do—that person pays no tax on that superannuation income. No tax whatsoever, and yet the government wants to slug part pensioners who are earning an income of around $24,000 to $28,000 a year and take almost one quarter of their income from them in these reforms! How on earth is that fair? How on earth can I, as a representative of my community, say that is fair and agree to these reforms? I cannot and I will not.

We also have 24,000 Australians with superannuation balances of more than $2 million. Again, under this proposal that the government is looking at, they will pay no tax at all and yet the government wants to slug pensioners and those who are the most vulnerable in our community. They want to cut the pension by almost a quarter for some of those people, people who are earning around $25,000 a year. They want to take it off their pension. It is unfair, because it attacks the most vulnerable in our community. It is something that I will not be part of.

And I am not the only person who is making claims about this. Many in industry are as well. In their submission to the Senate social services legislation bill inquiry—this bill—Industry Super Australia said:

… efforts to obtain short-term budget savings by tightening Age Pension benefits are likely to undercut community living standards in an inappropriate way.

… … …

ISA-Rice Warner modelling indicates that the proposed changes to the Age Pension asset test and taper rate in this Bill are misguided because they reduce the retirement incomes of Australians who currently are on modest incomes, and whose retirement incomes are projected to be below that sufficient for a comfortable standard of living in retirement. Over time, the changes would adversely affect about 40 per cent of Australians, and 8 in 10 single women.

This will disproportionately affect a vulnerable group within our community.

I mentioned earlier the view of this government that the pensions paid to Australians are unsustainable into the future. I have done a bit of research into this issue. In 2013 the OECD published a report of comparable rates of pensions and social service payments to populations in OECD nations. Currently, Australia spends about 3½ per cent of GDP on pensions, according to the OECD. But when you compare that to other nations in the OECD—like the United Kingdom, which pays six per cent of its income; France, which pays 14 per cent of its income; and Sweden, which pays eight per cent of its income—Australia is in a very responsible and sustainable position when it comes to pensions.

And what are the forecasts for the future? The forecast for the future for growth in pensions in the Intergenerational report in 2010 was that they would stay about the same as they are at the moment—around that level of 3½ to 4 per cent of income. Spending on pensions was forecast to be around the same as it is at the moment. The Intergenerational report of 2010 reported on Australia's comparative position, and it said:

Australia is comparatively well-placed in relation to Age Pension spending because the Pension is means-tested and targets poverty alleviation.

That was the view of the Intergenerational report, prepared for the government on fiscal sustainability into the future. An article in The Australian Financial Review said:

The claim that Australia's welfare system is "unsustainable" would surprise observers in most other OECD nations which spend a much higher percentage of their GDP on social security payments. Our emphasis on flat -rate, means -tested payments rather than earnings -related social insurance has limited the burden on Australian taxpayers.

I think that the key words in that are that our pensions are means tested and target poverty alleviation. This works to ensure that vulnerable Australians do not slip into poverty. That is what the risk is if these reforms are passed in respect of the pension taper rates.

So, we have seen that the pension is sustainable on comparative levels at the moment and that, according to the Intergenerational report, they are forecast to remain at that level and be sustainable into the future. But what about superannuation tax concessions?

The cost to the budget of superannuation tax concessions will grow from $11.8 billion in 2014-15 to $22.4 billion in 2017-18—over the space of four years, a 23 per cent increase in the cost to our budget by superannuation tax concessions.

If you want to talk about the sustainability of the budget in the future, why are we not looking as a nation at superannuation tax concessions? Why is this government targeting the most vulnerable in our community but letting the wealthiest, those with $10 million in superannuation, off the hook by paying no tax? That is because they have an ideological obsession with driving down the value of the pension and we saw that in last year's budget. That is why I and my colleagues will oppose these changes.